1997 (10) TMI 128

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... umbers of glass bottles under Rule 57-I of the Central Excise Rules, 1944. 2. Appellants are engaged in the manufacture of aerated waters falling under Chapter sub-heading Nos. 2201.12, 2202.11 and 2202.12 as also certain other items. They were also taking Modvat credit of duty paid on inputs used in the manufacture of their final products. Scrutiny of gate passes relating to glass bottles by the Department showed that glass bottles were first printed/decorated/labelled and then despatched to the appellants factory which meant that glass bottles were not received by the appellants in original packing condition. It was also observed that the cost of the bottle was not included in the assessable value and as per the provisions of Rule 57A( .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... inting/decoration through job workers, the Board had clarified that so long as duty had been paid on glass bottles credit should not be denied merely for the reason that they had been treated as fixed assets or because they have not been received in original packing. Collector also verified from duty paying documents whether the procedure prescribed for the said purposes had been satisfied. On the basis of the verification, Collector allowed Modvat credit on 18,93,816 Nos. of empty bottles lying in stock on 25-7-1991 but denied it in respect of 3,13,728 Nos. of bottles filled with aerated waters in view of the provisions of Rule 57H(1)(b) (as it stood at the relevant time) which restricted the benefit to inputs used in the manufacture of fi .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... edit lying in stock when the final product was withdrawn from Modvat Scheme. Relying on the decision of the Tribunal in Tripty Drinks (P) Ltd. v. Collector of Central Excise, 1993 (63) E.L.T. 101, the Tribunal had held that since there was no provision in the Modvat Rules or in the Notification withdrawing the benefit of Modvat Scheme on the final products there cannot be any recovery of credit already utilised under Rule 57F. Further, the Tribunal has in Ravi Paints and Chemicals v. Collector of Central Excise, 1996 (63) ECR 433 held that credit taken on inputs and utilised when the final product was dutiable would not be required to be reversed when the final product becomes exempted from duty subsequently. We also find that the M.P. High .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X